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CHELTENHAM NATIONAL BANK v. GEORGE B. HENNE & CO. (12/01/75)

decided: December 1, 1975.

CHELTENHAM NATIONAL BANK
v.
GEORGE B. HENNE & CO., INC., APPELLANT



Appeal from order of Court of Common Pleas, Trial Division, of Philadelphia, Sept. T., 1974, No. 5803, in case of Cheltenham National Bank v. George B. Henne & Co., Inc.

COUNSEL

Bruce E. Endy, and Meranze, Katz, Spear & Wilderman, for appellant.

Samuel J. Hecht, for appellee.

Watkins, P. J., Jacobs, Hoffman, Cercone, Price, Van der Voort, and Spaeth, JJ. Opinion by Cercone, J. Dissenting Opinion by Price, J.

Author: Cercone

[ 237 Pa. Super. Page 312]

The instant appeal arises from the dismissal of appellant's petition to set aside a sheriff's sale of certain real estate formerly owned by defendant corporation. The appellant filed the petition in his alleged capacity as a principal stockholder and officer of defendant corporation.

[ 237 Pa. Super. Page 313]

The mortgagee bank, as respondent and appellee herein, had taken a judgment of foreclosure by admission prior to appellant's petition to set aside the sheriff's sale, but had not directed the sheriff to serve appellate because the bank believed appellant had sold his stock and interests in Henne & Co. prior to the default. It was this alleged sale, which appellant claimed had never been consummated, that formed the factual crux of appellant's petition.

The sheriff's sale occurred on November 4, 1974, pursuant to the aforementioned judgment of foreclosure on October 10, 1974. On November 12, 1974, appellant filed his petition attacking the sale on the basis of the bank's failure to have him served as a principal shareholder of the mortgagor, and alleging that the judgment was the product of fraud and collusion. The court below thereupon issued a rule upon plaintiff bank and defendant corporation to show cause why the sale should not be set aside. Not surprisingly, the defendant corporation did not file an answer, but the bank responded averring that at all relevant times appellant was not a stockholder in defendant corporation, having sold his interest on February 1, 1972. The bank also denied that the judgment was fraudulent or collusive. Although appellant filed a reply to the bank's answer, the reply did not resolve the disputed factual questions, and only underscored the need for depositions. No depositions were ever taken.

Unlike the majority of counties in Pennsylvania, in Philadelphia County petitions before motions' court which are answered are automatically set down for argument by the prothonotary. Ordinarily, if depositions are required, i.e., if the material facts are in dispute, the court must be so notified of the intention to take depositions within fifteen days of the filing of the answer. The lower court found that petitioner's failure to take depositions constituted a demurrer to respondent's answer, so

[ 237 Pa. Super. Page 314]

    that all averments in the answer were treated as true for the purpose of argument. That conclusion was fatal to appellant's petition, since the answer averred that petitioner was neither a stockholder nor officer in defendant corporation and, hence, had no standing to challenge the judgment of foreclosure. Therefore, upon the pleadings the court dismissed appellant's petition.

Appellant then filed a petition to vacate the order dismissing his former petition. In this petition appellant claimed that the factual issues raised by his former petition and the answer were in conflict so that the court erred in treating his failure to take depositions as an admission of the averments in the answer. In support of this position appellant pointed to Pa. R.C.P. 209 which requires a respondent to rule the petitioner ...


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